RCom may hive off DTH, IPTV businesses into separate entity

Reliance Communications is planning to hive off its direct-to-home (DTH) and Internet protocol TV (IPTV) businesses into a separate company titled Reliance Digital Works.

Sources said RCom plans to bring multi-system operators (MSOs) and foreign investors into the new company for funding its expansion plans.

The company declined to comment on the issue.

Currently, the group operates the DTH business under the brand name Reliance Big TV, which is a subsidiary of Reliance Communications. It has about 2.3 million subscribers.

Reliance Digital Works is expected to offer a 25 per cent stake to overseas investors and 10 per cent stake to multi- system cable operators (MSOs), sources said.

Earlier this month, RCom had taken permission from its board of directors to sell as much as 26 per cent to investors at a premium to its stock price.

The Reliance ADA Group has already hived off its film exhibition and processing arms into Reliance Media Works, and FM radio and outdoor advertising businesses into Reliance Media World.

Both Reliance Media Works and Reliance Media World are listed entities on the Bombay Stock Exchange and the group has been looking for capital infusion into its growing DTH business.